O'Connell v Crouch & Lyndon (No. 2)
[2014] QDC 259
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- Unreported Judgment
- O'Connell v Crouch & Lyndon (No. 2)[2014] QDC 259
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O'Connell v Crouch & Lyndon (No. 2)[2014] QDC 259
O'Connell v Crouch & Lyndon (No. 2)[2014] QDC 259
DISTRICT COURT OF QUEENSLAND
CITATION: | O'Connell v Crouch & Lyndon (No2) [2014] QDC 259 |
PARTIES: | Cathy Maree O'CONNELL (Respondent/Appellant) -and- CROUCH & LYNDON PTY LTD (Applicant/First Respondent) |
FILE NO: | BD 2008/14 |
DIVISION: | Civil |
PROCEEDING: | Appeal |
ORIGINATING COURT: | Magistrates Court, Brisbane |
DELIVERED ON: | 20 November 2014 |
DELIVERED AT: | Townsville |
HEARING DATE: | Hearing on the papers |
JUDGE: | Durward SC DCJ |
ORDERS: |
|
CATCHWORDS: | PRACTICE & PROCEDURE – COSTS – CERTIFICATE OF COST ASSESSOR – FINALITY OF CERTIFICATE – whether in circumstances where no specific statutory review sought within time an order adjusting the costs assessed by Cost Assessor can be made – where magistrate reduced the Costs Assessment by a sum relating to an issue about costs thrown away by an adjourned hearing caused by incompetence of affected party’s lawyer. PRACTICE & PROCEDURE – COSTS – SUCCESSFUL PARTY – basis upon which assessed – application of the general rule where unsuccessful appellants appeal refused and respondents associated applications considered but not fully determined on their merits, because of refusal of appeal, and dismissed. |
LEGISLATION: | Sections 322, 335, 340 and 341 Legal Profession Act 2007; Chapter 7 Part 4 of the Uniform Civil Procedure Rules 1999. |
CASES: | La Spina v MacDonnells Law [2014] QSC 44; Nashvying Pty Ltd & Ors v Giacomi [2009] QSC 31; Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621; Radich v Kenway & Anor [2014] QDC 60; Southwell v Jackson [2012] QDC 65. |
COUNSEL: | No appearances required |
SOICITORS: | Alexander Law for the Appellant Crouch & Lyndon Lawyers for the First Respondent |
- [1]I delivered judgment in this appeal on 24 September 2014. I reserved two issues for further submissions, namely:
- The quantum of the judgment sum; and
- Costs of the appeal.
- [2]The first respondent has sought directions and a decision on the assessment pursuant to rule 743H UCPR. However, the orders sought reflected the Cost Assessor’s Certificate namely:
Costs as assessed$19,010.24
Less payment by appellant in May 2013$3,144.84
Balance due$15,865.40
1.The judgment sum
- [3]The Cost Assessor’s Certificate was issued for the sum of $15,865.40, payable by the appellant Ms O'Connell to the first respondent, Crouch and Lyndon Pty Ltd.
- [4]His Honour Magistrate Nunan adjusted that sum, when deciding the matter was before him, by making a reduction of $2,500.00.
- [5]The issue is whether it was open for his Honour so to do where there was no application for statutory review of the Cost Assessor’s Certificate within the time permitted in the Uniform Civil Procedure Rules 1999 (“UCPR”).
- [6]His Honour relied on what he referred to as a “wide ranging discretion” under the Legal Profession Act 2007 (“LPA”) and the UPCR, in making the reduction.
- [7]Hence there is a real question as to whether there is any basis upon which the Magistrate could have adjusted it; and whether I should confirm the effect of that adjustment in the quantum of costs awarded in the judgment sought by the first respondent.
2.Costs
- [8]The costs issue is about the quantum of the costs of the appeal and associated applications.
Submissions
- [9]The parties have each provided further material by way of affidavit and written submissions about those two discrete issues.
- [10]However, the appellant’s submissions, which are contained in her affidavit, re-canvassed matters beyond the two discrete issues that I reserved for further consideration. To the extent that she has done so, I will not take those submissions into account. The substantive judgment has been delivered. It is not open to the appellant to re-litigate issues already determined by me.
- [11]Having said that, the appellant has nevertheless referred, albeit in a brief and somewhat oblique way, to the two issues upon which I requested further submissions and I will of course take those submissions into account.
- [12]The appellant makes reference to the reduction of the assessment in the Cost Assessor’s Certificate, in an oblique way, in paragraphs 40 to 42, 65, 66 and 76 of her affidavit. In paragraph 76 the appellant deposes:
“76.Judge Nunan rightly refunded over $2,500 (no GST component) for Bill Walsh as he did not do any work for me but because of his incompetence and that of Mardee Campbell my court date at QCAT was vacated and it took me months to get another one …”
- [13]The respondent submitted that Magistrate Nunan had no power pursuant to Rule 742 UCPR to review the Cost Assessor’s Certificate. Rule 742 provides for the filing by a party dissatisfied with the Cost Assessor’s Certificate of an application to the court for review. No such application was made. The matter was before the court on an application dealing with another issue.
- [14]The first respondent’s submission at the hearing of the appeal left the issue of the $2,500.00 further reduction applied by Magistrate Nunan, in effect, in abeyance. The first respondent has not challenged his Honour’s decision. However, it is not open to the first respondent to simply ignore that determination. The question really is whether the further reduction was open to be made in circumstances where there was no statutory review of the Costs Assessor’s Certificate within the time permitted in the UCPR and where the Costs Assessor’s Certificate appears to be regular.
The Magistrates decision
- [15]His Honour Magistrate Nunan made the statement about “a wide ranging discretion” on his construction of Rule 743H UCPR, in order to review the Cost Assessor’s Certificate (despite the fact that no application was made for such a review) and to make the reduction in the costs assessment that he ordered.
- [16]His Honour had referred to Rule 743H of the UCPR and then considered what had occurred after the Cost Assessor’s Certificate had issued:
“Now, there was process that the applicant could’ve followed. Mind you, no one told her about this. But she could have asked the Cost Assessor for his decision under Rule 738 of the Uniform Civil Procedure Rules. And then after getting those reasons she could have sought an application to review it. But that application would have to state the specific and concise grounds for objecting to the certificate and have attached to it any written reasons given by the Cost Assessor. But that – one only gets 14 days after you receive the reasons to do that. Again, not a very satisfactory situation, and there doesn’t seem to be any obligation on the Cost Assessor or the respondent to explain or to tell the applicant that those are their rights and that there’s a very restricted time limit.
The applicant’s objections to the costs are more broad ranging. She’s not saying a specific item was not done competently; she’s saying overall most of the work should not have been done because it’s associated with this joinder debacle. The Cost Assessor has gone through and disallowed any claim directly associated with that joinder application. But that also – that joinder application effectively derailed the trial which was set for the 9th and 10th May last year. There was an application to court the day before, on 8th May, and the barrister seems to have been involved in this although there’s never, on the face of it, been any opinion given by the barrister, nothing in writing, except for his rather broad bill. And at the time there was no reasons given by member Oliver, of QCAT, as to why a particular company was joined and then unjoined.
Apparently the matter went to trial, in December last year, before a different member; there’s been a decision given. The defendant had the assistance of some geo-technician, she said, who charged her lots of fees and in the end there was a decision given that the application failed because of a lack of jurisdiction because the amount claimed was some $200,000 apparently, was over the jurisdiction of the tribunal. But I asked to see that decision but neither party – well, both parties agreed that it wasn’t relevant to what I have to do here. So I’m in a very difficult position because I haven’t got the file. I’ve got limited material put before me. There’s a lot of irrelevant and unindexed material filed by the applicant but it’s very difficult for me to assess whether or not the solicitors have been negligent. And whether or not the barrister deserves any fee at all because he seems to have been involved in this application to join an individual. I’m not sure why he thought that was appropriate but he seems to have been involved.
So, taking all that into account, I’m satisfied that there was work done by the respondent for the applicant and that the assessor, Mr McLennan, has done a good job of assessing, on the face of the material before me, assessing those fees and he is – he has disallowed items directly associated with the joinder application. But he hasn’t taken into account that ill-fated application – or debacle as the applicant calls it – effectively derailed the trial and therefore had further affected the fees being charged by the solicitors and the barrister. Now, I seem to have a wide ranging discretion here under the Legal Profession Act and the Uniform Civil Procedure Rules. So I’ve gone through the bills and decided to reduce them by a further $2,500 approximately.
And what I have decided to do – and that’s applying the onus of proof on the balance of probabilities which is on the applicant …”
Issue 1: the judgment sum
- [17]Sections 335, 340 and 341 of the Legal Profession Act 2007 set out the application for costs assessment, the process of assessment and the criteria for assessment, respectively; and Chapter 7 Part 4 of the UCPR set out the rules applicable to an assessment.
- [18]Mr McClelland’s Cost Assessor’s Certificate was made pursuant to Rule 737 and filed on 07 January 2014. The court has power to review the assessment: rule 742 UCPR. However, as I have said, the appellant did not seek such a review.
- [19]Under Rule 743H (3), the court has power to give directions and to decide issues in dispute. Pursuant to Rule 743H (4), where there are no issues in dispute the court has power to give judgment on the Cost Assessor’s Certificate as it deems appropriate (my emphasis).
- [20]The issue of the finality of the Cost Assessor’s Certificate really comes down to the question whether Magistrate Nunan decided that there were issues of dispute between the parties, considered those issues and resolved them. It would have been open for him so to do pursuant to Rule 743H (4) because the rule enables him to give judgment, as I have emphasised, on the Cost Assessor’s Certificate “as it deems appropriate”; and a further question, whether a determination pursuant to that sub-rule can be made in circumstances where no specific application for review has been made.
- [21]In other words, the questions are whether Magistrate Nunan could adjust the Cost Assessor’s Certificate on a review that he has in fact instigated himself, in the course of an application made by the appellant on a different issue, albeit one that arises out of the same facts and circumstances generally: that is, a dispute about the costs of the proceeding for which the first respondent was retained by the appellant.
Discussion
- [22]There are not many case authorities concerning this issue. In La Spina v MacDonnells Law [2014] QSC 44 it was held that where there are issues in dispute between the parties, a court does not have the power to make an order under Rule 743H (4), without considering and deciding those issues.
- [23]In that case, the appellant had ‘applied to the court’ to review a Cost Assessor’s Certificate. Muir JA at [5] wrote:
“This Court was not referred to any such application but it would seem from the primary judge’s order of 24 January 2013 and from the reasons of Andrews DCJ, delivered on 9 April 2013, that the parties proceeded on the assumption that there was an application under r 742 and r 743I” (my underlining).
- [24]In Nashvying Pty Ltd & Ors v Giacomi [2009] QSC 31 the plaintiff sought a review of specific items in a Cost Assessor’s Certificate. Jones J reviewed the discretion conferred by Rule 742(6) of the UCPR, and wrote:
“[4]The discretion conferred by the sub-rule is a wide one. But it is to be exercised with a consciousness that it is effectively an appeal against the exercise by the Cost Assessor of a discretion. In general, the Court will interfere only where the discretion appears not to have been exercised at all or to have been exercised in a manner which is manifestly wrong.”
- [25]The plaintiff in Nashvying had sought the review of a specific item (the cost of perusing the reasons for judgment after trial), but had not raised that matter in her objections about the Cost Assessor’s Certificate. His Honour wrote:
“[15]… of course, not having raised it in her objections, the defendant would be precluded by R. 742(5) for doing so now.
[16]As it appears the Cost Assessor disallowed the claim on his own motion. It is necessary to determine whether he was justified in so doing …
[17]I reject this justification for the refusal of this item.”
- [26]His Honour referred to the manner that a court on a review will deal with the exercise of that discretion and referred to Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 at 629. In that case Kitto J was required to consider, inter alia, whether a taxing officer had exceeded his powers in dealing with matters beyond the specific objections made by the plaintiff about a bill of costs. His Honour wrote:
“Where no principle is involved, and the question is whether the Taxing Officer has correctly exercised the discretion which he possesses and is purporting to exercise, the Court is reluctant to interfere. It has undoubted jurisdiction to review the Taxing Officer’s decision even where an exercise of discretion only is involved, and will do so freely on a proper case, using its own knowledge of the circumstances: Western Australian Bank v Royal Insurance Co (1908) 7 CLR, at p 388; Clark, Tait & Co v Federal Commissioner of Taxation (1931) 47 CLR 142, at pp 145-146, but it will in general interfere only where the discretion appears not to have been exercised at all, or to have been exercised in a manner which is manifestly wrong; and where the question is one of amount only, will do so only in an extreme case: (1934) 34 SR (NSW), at pp 183, 184; 51 WN at p 73”.
- [27]In Radich v Kenway & Anor [2014] QDC 60 Judge McGuinness heard an appeal against a decision of a magistrate to affirm the decision of a Cost Assessor. Hence her Honour was dealing with an appeal of a magistrate’s decision “made on review” pursuant to r 742(6) UCPR.
- [28]The specific and relevant ground of appeal in Radich, so far as is relevant here, appears to be that which asserted that “the assessment was not in accordance with the rules of natural justice, specifically the Cost Assessor failed to notify the parties that he intended to review the entire file.”
- [29]Her Honour referred to a judgment of Judge McGill SC in Southwell v Jackson [2012] QDC 65 where his Honour rejected an argument that the process of assessment was to be limited to grounds specifically raised in an affidavit.
- [30]In Southwell his Honour wrote:
“(28) There is nothing in the [Legal Profession Act] which requires the assessment process to be limited to matters specifically raised in a Notice of Objection, and r 722 does not apply to an assessment under Part 4: r 743I. Traditionally a taxing officer taxing a bill examined the whole bill and considered every item, although no doubt in practice the fact that there was no particular objection to an item would ordinarily have some practical effect on the extent of that consideration. It was always open to the taxing officer to disallow or reduce an item if it were thought to be unjustified. I think that the fact that there is no limitation on the scope of the assessment in the Act is of particular importance when considering an assessment under the Act, and in my view the obligation of a Cost Assessor under the Act is to have some regard to all matters in the bill, at least to the extent of picking up an error of this nature.
(29)I do not consider that there is anything confining the process of assessment to items the subject of specific objection, or indeed, to considering the items which are objected to only by reference to the grounds raised in the Notice of Objection, though this does give rise to an issue about the rules of natural justice. It does not appear that submissions were invited from the respondent in relation to these particular items, no doubt because, as proved to be the case when I asked her about the matter during the hearing, there was no submission she could advance in support of this part of the bill as drawn.”
- [31]In my view the appellant in the course of the matter being dealt with by Magistrate Nunan clearly raised an objection to or concern about the adjournment of a proceeding before the Magistrates Court in respect of which costs were thrown away. Indeed, she raises that issue again in the course of her affidavit in the matter that I am now considering.
- [32]Whilst Jones J refused a ‘review’ in Nashvying, the circumstances are different here and are in my view distinguishable from those in Nashvying. Muir JA in La Spina had a difficulty in dealing with a review on an ‘assumption’ that an application for review had been made at first instance. In Southwell, ‘the review’ was able to canvass matters not specifically referred to in the objections (application). Even though the dispute here is about an ‘amount’, nevertheless I consider Magistrate Nunan was correct in his exercise of the ‘broad discretion’.
His Honour Magistrate Nunan was correct to refer to the discretion pursuant to the rules as being a wide discretion. Whilst no discrete application for review was made, the matters that would have been open to review had an application been made, were patently canvassed in the course of the proceeding that his Honour had to deal with and the first respondent did not raise any objection to that. Mr McClelland had not taken into account the costs of the adjourned hearing. He should have done so in the circumstances. He had discounted the fees relating to the disputed ‘joinder issue’ in his Costs Assessment Certificate. Magistrate Nunan clearly considered that Mr McClelland had not gone far enough to redress that dispute by dealing with the costs effectively thrown away by the adjournment of the two day hearing, the adjournment being clearly directly related to the disputed ‘joinder issue’.
- [33]His Honour in his thorough assessment of the whole of the matters the subject of the application before him recognised that there was an issue in dispute about the fees charged in respect of the adjourned hearing. He was motivated to reduce the Cost Assessor’s Certificate by an amount (albeit not including any GST component) to reflect the fact that at least impliedly the Cost Assessor had erred in not having done so himself in the Certificate.
- [34]In my view, Magistrate Nunan did consider and decide an issue of dispute between the parties with respect to the costs relating to the adjournment of the Magistrates Court proceeding. He altered the Cost Assessor’s Certificate in a way that he considered appropriate. It was open for him so to do pursuant to Rule 743H (4) UCPR.
- [35]I expressed that view despite the submission by the respondent that “there was no evidence before the Court as to the further effect of the ‘derailing of the trial’”. I do not consider that submission to properly reflect what occurred in the hearing before Magistrate Nunan. His Honour had considered all of the material thoroughly and arrived at the view that the relevant proceeding had derailed.
Conclusion: judgment sum
- [36]It appears to me that the amount of $2,500.00 was the fee, but it did not include the GST component. That does not matter, because the latter does not appear to have been an added impost on the appellant. Accordingly, I consider that the reduction of $2,500.00 in the sum assessed in the Cost Assessor’s Certificate was just in all the circumstances; was able to be achieved by a proper exercise of discretion; and was done as a consequence of a thorough consideration of a dispute, that is a matter that was in issue between the parties.
Issue 2: Costs of the appeal and associated applications
- [37]The respondent has sought its costs of responding to the appeal and of its applications: one to strike out; the other for security for costs.
- [38]I reserved this matter for further consideration to give the appellant an opportunity to respond to an order for costs. Whilst she has not explicitly addressed the issue in her affidavit, nevertheless it is implicit that she wholly opposes a costs order.
- [39]On the hearing of the appeal there was affidavit material from the respondent which set out costs predicated on the appeal going to a hearing on the merits, as distinct from the manner in which the appeal was actually determined: that is, on the threshold point of leave to appeal. I was not prepared to trawl through the costs assessment that was then before the court to assess what costs might be associated with the hearing that in fact occurred.
Discussion: costs
- [40]In so far as the appeal is concerned, I refused leave to appeal on the grounds set out in the judgment. Had I given leave to appeal I would, as I observed in paragraph [48] of the judgment, have struck out the appeal on the ground of lack of merit.
- [41]I did not go on to determine the strike out application per se or the application for security for costs, because it was not necessary so to do. However, costs are nevertheless a live issue in respect of those applications because submissions were made and they were dealt with by me in a summary way in the judgment.
- [42]Rule 681 UCPR provides that the costs of a proceeding, including an application in a proceeding, are in the discretion of the Court but follow the event, unless the Court orders otherwise.
- [43]There is no proper basis for me to make an order other than that costs should follow the event. That is, that the successful party should have its costs of the appeal and of the applications.
Conclusion: costs
- [44]Accordingly, I will order that the appellant pay to the respondent its costs of the appeal and of the applications.
- [45]The respondent filed an affidavit by legal costs consultant, Mr Petersen, which exhibits an assessment of those costs in the sum of $6,994.90, inclusive of GST for standard professional fees and excluding GST for costs. I have perused the costs assessment and I see no reason to depart from that assessment.
ORDERS
- The appellant is to pay to the respondent the sum of $13,365.40.
- The appellant is to pay to the respondent its costs of the appeal and the applications, as assessed in the sum of $6,994.90.